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S&P Affirms Türkiye’s Successful Economic Plan

People shop at Grand Bazaar in Istanbul, Türkiye, November 4, 2022. REUTERS/Dilara Senkaya
People shop at Grand Bazaar in Istanbul, Türkiye, November 4, 2022. REUTERS/Dilara Senkaya
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S&P Affirms Türkiye’s Successful Economic Plan

People shop at Grand Bazaar in Istanbul, Türkiye, November 4, 2022. REUTERS/Dilara Senkaya
People shop at Grand Bazaar in Istanbul, Türkiye, November 4, 2022. REUTERS/Dilara Senkaya

Credit ratings agency S&P on Friday moved Türkiye’s long-term sovereign rating one notch higher to B+ from B, with a positive outlook, according to a statement late Friday.

The ratings agency then forecasted rising portfolio inflows and narrowing current account deficits over the next two years, alongside declining inflation and dollarization.

“Following local elections in Türkiye, we believe the coordination between monetary, fiscal, and incomes policy is set to improve, amid external rebalancing,” it said.

The agency said Turkiye's policymakers are set to persevere with efforts to reduce elevated inflation through a combination of monetary and credit tightening, less generous wage settlements, and gradual fiscal consolidation.

Türkiye has launched a series of steps meant to cool soaring inflation, which could reach around 75% in May when the government ends its plan to provide a monthly reduction on natural gas bills. Ahead of the 2023 parliamentary and presidential elections, the government has promised discounted natural gas bills for households for a year until May 2024.

S&P Global Ratings raised the country's rating outlook to positive in November in a move to recognize Türkiye’s shift to more orthodox economic policies and the central bank's steep rate hikes, made to rein in inflation, which climbed to 69.8 percent year-on-year in April despite raising the policy rate to 50 percent.

Türkiye ranks fourth in global inflation rates, surpassed by Argentina, Syria and Lebanon.

Fitch Ratings upgraded the country’s credit rating earlier this year to B+ while Moody’s raised its outlook to positive at the same time as affirming its B3 ranking.

Mehmet Şimşek, the Turkish treasury and finance minister, earlier cited his expectations for credit upgrades to continue in March following Fitch’s move.

“The positive outlooks of S&P, Fitch and Moody’s foreshadow further rating increases,” Simsek said Saturday in a post on X, formerly Twitter.

“The positive results of our program are reflected in the decisions of credit rating agencies,” he added.

“We are determined to carry the confidence in our country to the highest level with our strengthened program,” the minister also said.

Meanwhile, Burak Daglioglu, head of theTurkish Presidency Investment Office, said Türkiye last year rose to fourth place in Europe in attracting the most international investment projects.

“The $10.6 billion in international direct investment we attracted in 2023 is the most concrete sign of this success,” Daglioglu noted.

Commenting on a report by audit and consulting firm EY on foreign direct investment (FDI) projects in Europe in 2023, Daglioglu said Türkiye has maintained its steady rise in attracting the most international direct investment in Europe in the post-pandemic period.

He said EY found a significant fall from the previous year in FDI projects in Europe for the first time since the pandemic, blamed on factors such as low economic growth, high inflation, rising energy prices, and geopolitical risks.

He said 5,694 investment projects were announced in Europe, down 4% from the previous year.

The number of projects in Europe was 11% below its level in 2019 and 14% below the 2017 peak, according to Daglioglu.

He added that Türkiye ranked seventh in the European league in 2020 and fifth in 2022. “The country rose to fourth among the top 10 countries, attracting 375 international direct investment projects in 2023. With a 17% rise from the previous year, Türkiye also ranked first among the top 10 countries in terms of growth in 2023,” Daglioglu said.

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Business

China's Finance Ministry: Fiscal Policies Will be More 'Proactive' in 2026

A man walks on a street in Beijing, China, 24 December 2025. EPA/WU HAO
A man walks on a street in Beijing, China, 24 December 2025. EPA/WU HAO
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China's Finance Ministry: Fiscal Policies Will be More 'Proactive' in 2026

A man walks on a street in Beijing, China, 24 December 2025. EPA/WU HAO
A man walks on a street in Beijing, China, 24 December 2025. EPA/WU HAO

China's finance ministry on Sunday said fiscal policies will be more proactive next year, reiterating its focus on domestic demand, technological innovation and a social safety net.

The statement comes as trading partners urge the world's second-biggest economy to reduce its reliance on exports, underscoring the urgency to revive confidence at home where a prolonged property crisis has rippled ⁠through the economy, weighing on sentiment.

China will boost consumption and actively expand investment in new productive forces and people's overall development, the ministry said in a statement after a two-day meeting at which it set ⁠2026 goals.

In addition, Reuters quoted the ministry as saying that it will support innovation to foster new growth engines, and improve the social security system by providing better healthcare and education services.

Other tasks for next year include promoting integration between urban and rural areas, and propelling China's transformation into a greener society.

China is likely to stick to ⁠its annual economic growth target of around 5% in 2026, government advisers and analysts told Reuters, a goal that would require authorities to keep fiscal and monetary spigots open as they seek to snap a deflationary spell.

Leaders this month promised to maintain a "proactive" fiscal policy next year that would stimulate both consumption and investment to maintain high economic growth.

Business

Bulgaria Adopts Euro Amid Fear and Uncertainty

Customers shop in a grocery store in the village of Chuprene, northwestern Bulgaria on December 7, 2025. (Photo by Nikolay DOYCHINOV / AFP)
Customers shop in a grocery store in the village of Chuprene, northwestern Bulgaria on December 7, 2025. (Photo by Nikolay DOYCHINOV / AFP)
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Bulgaria Adopts Euro Amid Fear and Uncertainty

Customers shop in a grocery store in the village of Chuprene, northwestern Bulgaria on December 7, 2025. (Photo by Nikolay DOYCHINOV / AFP)
Customers shop in a grocery store in the village of Chuprene, northwestern Bulgaria on December 7, 2025. (Photo by Nikolay DOYCHINOV / AFP)

Bulgaria will become the 21st country to adopt the euro on Thursday, but some believe the move could bring higher prices and add to instability in the European Union's poorest country.

A protest campaign emerged this year to "keep the Bulgarian lev", playing on public fears of price rises and a generally negative view of the euro among much of the population.

But successive governments have pushed to join the eurozone and supporters insist it will boost the economy, reinforce ties to the West and protect against Russia's influence.

The single currency first rolled out in 12 countries on January 1, 2002, and has since regularly extended its influence, with Croatia the last country to join in 2023.

But Bulgaria faces unique challenges, including anti-corruption protests that recently swept a conservative-led government from office, leaving the country on the verge of its eighth election in five years.

Boryana Dimitrova of the Alpha Research polling institute, which has tracked public opinion on the euro for a year, told AFP any problems with euro adoption would be seized on by anti-EU politicians.

Any issues will become "part of the political campaign, which creates a basis for rhetoric directed against the EU", she said.

While far-right and pro-Russia parties have been behind several anti-euro protests, many people, especially in poor rural areas, worry about the new currency.

"Prices will go up. That's what friends of mine who live in Western Europe told me," Bilyana Nikolova, 53, who runs a grocery store in the village of Chuprene in northwestern Bulgaria, told AFP.

The latest survey by the EU's polling agency Eurobarometer suggested 49 percent of Bulgarians were against the single currency.

After hyperinflation in the 1990s, Bulgaria pegged its currency to the German mark and then to the euro, making the country dependent on the European Central Bank (ECB).

"It will now finally be able to take part in decision making within this monetary union," Georgi Angelov, senior economist at the Open Society Institute in Sofia, told AFP.

An EU member since 2007, Bulgaria joined the so-called "waiting room" to the single currency in 2020, at the same time as Croatia.

The gains of joining the euro are "substantial", ECB president Christine Lagarde said last month in Sofia, citing "smoother trade, lower financing costs and more stable prices".

Small and medium-sized enterprises stand to save an equivalent of some 500 million euros ($580 million) in exchange fees, she added.

One sector expected to benefit in the Black Sea nation is tourism, which this year generated around eight percent of the country's GDP.

Lagarde predicted the impact on consumer prices would be "modest and short-lived", saying in earlier euro changeovers, the impact was between 0.2 and 0.4 percentage points.

But consumers -- already struggling with inflation -- fear they will not be able to make ends meet, according to Dimitrova.

Food prices in November were up five percent year-on-year, according to the National Statistical Institute, more than double the eurozone average.

Parliament this year adopted empowered oversight bodies to investigate sharp price hikes and curb "unjustified" surges linked to the euro changeover.

But analysts fear wider political uncertainty risks delaying much needed anti-corruption reforms, which could have a knock-on effect on the wider economy.

"The challenge will be to have a stable government for at least one to two years, so we can fully reap the benefits of joining the euro area," Angelov said.

Business

Syria Prepares to Launch New Currency Amid Major Challenges

Syrian Central Bank Governor Abdulkader Husrieh (X)
Syrian Central Bank Governor Abdulkader Husrieh (X)
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Syria Prepares to Launch New Currency Amid Major Challenges

Syrian Central Bank Governor Abdulkader Husrieh (X)
Syrian Central Bank Governor Abdulkader Husrieh (X)

Syria’s central bank governor, Abdulkader Husrieh, said the new Syrian pound is not merely a means of exchange but a symbol of the success of the Syrian revolution, national belonging, and confidence in the country’s ability to recover.

In a Facebook post, Husrieh said that with the launch of the new currency, Syrians were not just celebrating a banknote, but also celebrating their sovereignty and national identity, noting that many international experiences show that national currencies become strong when people rally around them, according to the Syrian Arab News Agency.

He pointed to Germany’s experience, where the introduction of the mark after the war marked the starting point of economic recovery, and to France, where the new French franc became the financial symbol of the new republic, known as the Fifth Republic.

Husrieh said the central bank would carry out its role with a clear understanding of the challenges and opportunities, while committing to responsibility, transparency, and the protection of the national currency. He added that the cornerstone remains public solidarity and trust, because a strong currency begins with the people's belief in it.

He called for turning the launch into a dignified national occasion through which Syrians express awareness, confidence, and adherence to the pound as a symbol of sovereignty and a national choice.

Husrieh added that supporting the pound is supporting the nation, and taking pride in it is a matter of pride in the future for Syrians and their children. He described the move as an opportunity for a new success following the success of the revolution in liberation and the lifting of economic sanctions that had shackled Syria’s economy for nearly fifty years.

Husrieh had recently announced that Jan. 1, 2026, would mark the launch of the new Syrian currency and the start of the exchange process for the old notes, with the exchange to be carried out through 66 companies and 1,000 designated outlets.

Restoring confidence

Political and economic researcher Bassel Kouwefi said the exchange plans, if well implemented, could serve as an entry point for rebuilding confidence in the national economy, encouraging domestic investment, and paving the way for broader reforms in the financial sector. However, he warned against failing to address the root causes of inflation and economic collapse during the previous regime's rule.

Speaking to Asharq Al-Awsat, Kouwefi described currency exchange and the removal of zeros as complex economic measures.

He said their main benefits include simplifying daily transactions, reducing the volume of banknotes in circulation, boosting confidence in stability, lowering printing and transportation costs, simplifying accounting records and financial software, and reducing currency speculation driven by corruption networks seeking to undermine stability in Syria.

Kouwefi said the exchange plans, if well-executed, could help restore confidence in the macroeconomy, but stressed the challenges posed by failing to tackle the fundamental causes of past inflation and collapse, including fiscal deficits, instability, and weak production. He said a comprehensive economic and financial program was therefore essential.

He added that the process also requires strong banking infrastructure, an organized transition period, and sufficient liquidity in the new denominations.

He said these remain major challenges under current Syrian conditions, alongside the need to mitigate social impacts that could lead to public confusion, market exploitation, and difficulties for less informed segments of society.